Avoid knee jerk decisions that could hurt your company valuation
It’s clear that COVID is causing not just frustration, but exhaustion for many business owners. On top of this, owners are worried about what the upcoming Presidential election might mean for personal and business taxes. It’s causing a tipping point for some owners that are thinking enough might be enough and perhaps it’s time to think about exiting the business to someone else’s stewardship. This is great if your business is prepared to command the premium valuation you’ve dreamed of. But if not, this is not the time for short term, knee jerk actions.
If this is you or someone you know, here are a few tips that will hopefully help to maintain a rational mindset and avoid doing anything that could cause regret. There has been too much hard work to get the business to where it is today, don’t let COVID allow knee jerk decisions. A few thoughts:
- Revisit what your long-term plan has been for your business and what you wanted it to mean at time of exit to you and your family financially. Reminding yourself of the initial dream and plan you had for your business might invigorate you to hang in longer and muscle through or at least get you to avoid any hasty actions or decisions without giving deep thought to new expectations from an exit.
- Perhaps the exhaustion is being caused by all the defense you’re having to play during COVID. Could there be some degree, even if minor, of playing some offense and this might help to reinvigorate even the slightest spark in you to keep your head productively in the game at least until COVID passes and your business returns to some better days.
- Get away for a few days and take some time to recharge a battery or two. For some owners, this could also help further develop key members of the team that should be able to operate more autonomously without owner involvement.
- Think about your employees and remember that short term, knee jerk decisions right now might not only cause regret for yourself but could have negative impact on your team if the exit process doesn’t result in a positive outcome.
- Leverage an advisor or a member of your Board to help keep you focused on protecting and even trying to build the worth of your company. Having this outside coach and cheer leader can help keep you rational and focused on your bigger picture plan that you’ve been working towards.
Bottom line is this….you’ve worked hard for years to build what you have. Don’t start making knee jerk decisions about your business that could harm valuation and cause regret later. Find a way to keep focused on what has been your desired end game!
